Business of Baseball Reportby Brian Borawski
April 27, 2005
Comcast Files Suit Against OriolesIn the never ending fallout from the Expos' move to D.C., Comcast SportsNet, a subsidiary of Comcast Corp., has filed a lawsuit against the Baltimore Orioles. It appears the sweet regional sports network deal that Peter Angelos struck with MLB violates the terms of the distribution agreement Comcast has with the Orioles.
Even though Comcast’s current deal with the Orioles expires at the end of 2006, the company has an exclusive negotiating window with the team until November 1. The premature announcement by the team that they’ll be moving over to the newly created Mid-Atlantic Sports Network (MASN) prompted the breach of contract lawsuit.
What’s ironic is that the biggest casualty isn’t even the Orioles and Peter Angelos, but the Washington Nationals. The lawsuit has put an immediate halt on a deal between DirecTV and MASN to air around 70 Nationals games and has slowed the process MLB is going through to sell the team.
To garner public support, Comcast is also saying that the creation of MASN will result in a $2-$3 increase in cable subscription fees. As a current Comcast subscriber, I’m not sure I’m buying the final argument. With no competition outside of satellite in my area, Comcast has never needed a reason to raise our fees.
Minnesota Twins and Hennepin County Agree on Stadium DealIn what appears to be more of a public relations ploy then anything, a lot is being made about Twins owner Carl Pohlad bucking up $120 million of his own money for a new stadium. Lost in all of this is the fact that Hennepin County will be on the hook for the remaining $350 million, and that’s assuming they come in within their budget. The new open air stadium itself will run $360 million, with the remaining costs going toward bonding, site preparation, and improving the surrounding infrastructure.
While it appears that the state is off the hook, the Twins still prefer a retractable dome, and it looks like the team is looking towards the state to come up with $100 million for that. The county plans on getting an increase in the sales tax for the county, and they’re going to do it without a public referendum that would surely kill the entire deal.
No Deal Between Angels and City of AnaheimIt seems you can negotiate for only so long. Since April 1, the City of Anaheim and the Los Angeles Angels of Anaheim have been in mediation in an attempt to air their differences over the city’s lawsuit. While the mediation period has ended, both sides have agreed to continue talking to try to resolve this outside of court.
The fundamental difference still remains. The city doesn’t want the Angels to have “Los Angeles” in their name, while the team resists removing it. The city lost the first round in court, and they'll have a second chance with the appellate court. The hearing is scheduled for November 7.
Steinbrenner on the Hook for Record Luxury Tax PaymentThe total bill will be in excess of $30 million. All that, and they couldn’t even walk away with a pennant.
The Yankees' $204.6 million team salary, along with the fact that they’re the only three-time luxury-cap offender, explains the large “tax” bill. The World Champion Boston Red Sox are the only other team on the hook this year, but their bill is less than $1 million. The Los Angeles Angels of Anaheim are the only other team who’s ever had to pay the luxury tax, when they paid just under $1 million last year.
Brian Borawski is a member of SABR's Business of Baseball Committee and writes about the Detroit Tigers at his own website, TigerBlog. He welcomes comments, questions and suggestions via e-mail.